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Posts Tagged ‘Mortgage Deals’

There are new 90% mortgage deals on the market for first time buyers from both the Nationwide building society and the Post Office. After the announcement that cuts in interest-only mortgage lending would hit first time buyers the hardest, these new mortgage deals look set boost the chances for new property investors in London.

As of today first time buyers can access mortgage deals from the Post Office that have been heralded as some of the best buys on the market. The deals have become available after Government funding to the tune of £180m was injected into the Post Office to help increase the range of banking services and in particular help fund high LTV mortgages for first time buyers.

The 90% mortgage deals are available at two, three or five year fixed rate of 5.45%, 5.99% and 5.99% again respectively. The three year option is also available with a lifetime tracker of 4.99% above base rate. It is thought that these new products aimed specifically at first time buyers could double the value of the company’s books, justifying the large investment.

The Nationwide 90% mortgage deal is only available to existing customers, specifically ones whose main current account is the FlexAccount. This reflects the growing trend for banks and building societies to be offering their best mortgage deals to loyal customers directly, and it also addresses the need to boost the proportion of first time buyers to bolster the property market.

The Nationwide deal is available with a three year tracker at 4.48%, a rate previously only accessible to those who had a t least 30% deposit, and there is speculation that existing customers with a FlexiAccouint could in fact strike a 95% LTV deal with the building society. For Londoners who are not able to take advantage of the Nationwide deal, and feel that the Post Office tracker rates aren’t quite good enough, the advice is to sit tight; 90% first time buyer mortgages will be coming to a bank near you soon.

According to a rather popular price comparison site, this spring is strong for the mortgage market. There are better mortgage deals than ever and more people applying for them too, including first time buyers and those looking to remortgage. The initial boost for the rise in applications from first time buyers came just days after the Chancellor announced a two year stamp duty holiday for first time buyers when purchasing a property under £250,000; a trend that has remained strong, and positively affected other areas of the mortgage market.

The interest from first time buyers in London rose by 17% in March, but the number of people interested in remortgaging increased by a staggering 29%. This has been due to the number of competitive mortgage deals available. However Londoners are being warned that although competition is returning, it is still wise to watch out for deals that offer low interest rates but charge extortionate fees.

The recovery of the mortgage market looks set to continue over the coming months, despite uncertainty about changes in interest rates due to the coming election. Financial experts think that there will be favourable deals well into the summer, and not just for those with a large deposit. At the moment HSBC have a 4.49% fee free tracker first time buyer deal, offering up to 90% LTV, which is ideal for anyone wanting to get a foot on the ladder whilst interest rates are still low.

For those who can access a larger deposit, HSBC have an even better first time buyer deal – the 2 year discounted mortgage. At 1.9%, this mortgage is half a percent less this April than it was in April of 2009, but to secure it, you will need to find at least 40% deposit as the LTV is a maximum of 60%, and bear in mind that it also comes with a £999 fee. If figures such as these continue to be on offer, the housing market looks set to recover further.